In a new report titled The Mining Cliff: How far have we come?, NAB said an insatiable demand for commodities from China saw "unprecedented" levels of mining investment and commodity exports in the years leading up to 2012-13.
However, the combination of slowing demand from China and increased commodity production saw bulk commodity prices peak in late 2011, the report said.
Modelling by NAB indicates that mining investment is likely to fall by around 70 per cent from its current level over the next three years.
This implies the mining investment 'cliff' is currently more than halfway through, said NAB.
"As a percentage of GDP, mining capex has fallen from 8 per cent of GDP at its peak to around 4.25 per cent currently and is expected to fall to 1.5 per cent of GDP by late 2018," said NAB.
About 46,000 mining jobs were shed between the peak of the mining boom in 2012-13 and 2014-15 – and over 50,000 more are likely to be cut.
Most of the cuts will take place in Western Australia, causing "significant headwinds" in geographically affected regions of the country, said NAB.
"However, it is not unmanageable at the national level with offsetting job creation elsewhere (particularly in services sectors)," the bank said.
"We are forecasting 18,000 additional jobs to be created per month over the next few years, with the unemployment rate to track down towards 5.5 per cent by mid-2017 before inching up thereafter."